In this regard, RBI has issued a notification which prohibits the manufacturing of tobacco products activities such as wholesale cash and carry, retail trading as they fall under the sectoral restrictions.

This prohibition will be in case of manufacturing of cigars, cigarillos, cheroots and cigarettes of tobacco or of tobacco substitutes. Henceforth with this FDI restriction, other activities related to these products will be governed by the sectoral restrictions laid down in the FDI policy.

It should be noted that the Department of Industrial Policy & Promotion (DIPP), under the aegis of Union Commerce Ministry has framed these guidelines on this sectoral restrictions.